The chairman and CEO of ASOS have both bought shares in the online fashion giant the day after almost 40% was wiped off its share price following a shock profits warning.
ASOS announced yesterday morning that it had witnessed a significant downturn in trading during November and was revising down its full-year growth and profits forecasts as a result.
The company said it now expected sales growth of 15% for the year to August 2019, down from 20% to 25%, it revised down its earnings margin from 4% to 2%.
Given the unexpected nature of the announcement due to ASOS’s previously robust performance and the fact that it is not exposed to the move away from physical retail, investors sold off shares rapidly wiping almost 40% off its value in a single day. Its shares dropped from 4,191p at close on Friday to 2,614p by close of trading yesterday.
Chairman Adam Crozier purchased 3,650 shares today at £26.71 per share while CEO Nick Beighton purchased 3,645 shares at £27.35 per share. The pair invested roughly £100,000 each. Today shares closed down a further 0.54% at 2,600p and are down around 60% since the start of the year.
ASOS was far from the only retailer to report tough trading in November. A combination of unseasonably warm weather, a disappointing Black Friday and uncertainty surrounding Brexit have all contributed to disappointing results.
However shoppers are expected out in force this weekend, both online and off-line, in what is being dubbed “Super Saturday”. A total of £1.65bn in expected to be sent in-store and online as shoppers have held out spending to the last possible moment in the hope of taking advantage of discounts.